UC San Diego may lose Qualcomm as a key benefactor if company is sold

One of UC San Diego's biggest supporters is Matt Grob, chief technology officer at Qualcomm. He is shown here using a tiny drone at a conference held on campus, at the Qualcomm Institute.

One of UC San Diego's biggest supporters is Matt Grob, chief technology officer at Qualcomm. He is shown here using a tiny drone at a conference held on campus, at the Qualcomm Institute. (UC San Diego School of Engineering)

No one’s panicking. But these are anxious days at “UC Qualcomm,” which is how many people refer to the science mecca that is UC San Diego.

The university could be on the verge of losing its close partnership with Qualcomm, the San Diego chip maker that helped the campus create the largest engineering school on the West Coast and become a national leader in medicine.

Qualcomm is the target of a fierce take-over bid by Broadcom, a Singapore-based chip maker that has few ties to San Diego and which isn’t known for sponsoring university research.

The battle has sent shivers through UC San Diego, which is located across Interstate 5 from Qualcomm. Since 2001, the company has given the school $54 million in donations and research contracts.

To various degrees, Qualcomm is currently helping the university do such things as test drones and driverless vehicles, explore whether chips implanted in the brain can help deaf people communicate, and develop smartphones that can perform medical diagnostics on blood, urine and saliva.

Broadcom operates differently.

“(It’s) known as a mergers and acquisition company. Rather than doing their own R&D they go and buy companies, get the technology, increase the value of your stock and get rid of anything that doesn't match,” said Henrik Christensen, director of UC San Diego’s Contextual Robotics Institute.

K.C. Alfred/Union-Tribune

Henrik Christensen, director of UC San Diego's Contextual Robotics Institutes, says the school's graduates and faculty could lose many research and job opportunities if Broadcom buys Qualcomm

Henrik Christensen, director of UC San Diego's Contextual Robotics Institutes, says the school's graduates and faculty could lose many research and job opportunities if Broadcom buys Qualcomm (K.C. Alfred/Union-Tribune)

“Qualcomm is very much known (for) R&D. They have a very long-term view, whereas Broadcom (says) 'Let's make some money now.’ “

Financial analysts say Broadcom would likely cut jobs if it buys Qualcomm, which has about 13,000 employees in San Diego County, mostly near the university.

“If (Qualcomm) gets sold — short of it getting up and leaving en masse — I don’t see the impact on San Diego being that significant,” said UC San Diego Chancellor Pradeep Khosla.

But down-sizing could lead to fewer opportunities for UC San Diego students, graduates and faculty. And Khosla agrees that Broadcom doesn’t cozy up to research universities, based on how the company has interacted with UC Irvine.

That relationship developed over the past two decades, after Broadcom moved part of its operations to Irvine from Los Angeles. For years, the company was located adjacent to UCI, which shares Broadcom’s interest in wireless technology.

One of Broadcom’s co-founders, Henry Samueli, developed strong personal ties to UCI. He has given the university at least $250 million in donations, and UCI’s engineering school bears his name.

But Broadcom, as a company, has not given tens of millions of dollars to UCI. The company’s engineers have done comparatively little work with the university’s faculty. And there are no buildings at UCI named after Broadcom.

Not investing in UCI hasn’t hurt Broadcom financially. The company was sold to chip maker Avago Technologies for $37 billion in 2015. Avago is now known as Broadcom. It’s based in Singapore but is expected to move its headquarters to San Jose.

The relationship between Qualcomm and UC San Diego has unfolded differently, largely because of the influence of Irwin Jacobs, one of the university’s former faculty members.

Jacobs initially co-founded Linkabit, a company that developed encryption devices for satellites, then went on to co-found Qualcomm, which specializes in wireless communications.

He helped grow the companies by partnering with, or supporting, university researchers, including those at UC San Diego. Qualcomm evolved into one of the world’s biggest telecommunications companies, earning Jacobs a fortune. Forbes estimates his current wealth at $1.3 billion.

Along the way, Jacobs became a major philanthropist. He and his wife Joan have done everything from give $120 million to save the San Diego Symphony from bankruptcy to donate $30 million to help build the San Diego Central Library.

The couple also has given UC San Diego about $286 million since the early 1980s. When combined with support from Qualcomm and gifts from two of the company’s former presidents, the figure rises to nearly $400 million.

“Qualcomm and the Jacobs have elevated engineering and medicine at UCSD in the way that Hewlett-Packward helped to grow Stanford,” said Ivor Royston, who founded Hybritech, San Diego County’s first biotech company.

The impact on UC San Diego is impossible to miss. The campus is home to the Qualcomm Institute — a technology test bed — as well as the Jacobs School of Engineering and the Jacobs Medical Center. Richard Sulpizio, a former Qualcomm president, helped fund a major cardiovascular center at the university. Steve Altman, also a former Qualcomm president, helped fund a large research institute in translational medicine.

Franklin Antonio, a Qualcomm co-founder, recently gave the campus $30 million to help underwrite a $180 million engineering complex.

The university does not live or die based on money it gets from Qualcomm or the Jacobs family. UC San Diego brings in about $1.1 billion a year in research contracts, the majority of which come from the government and foundations.

But it always heavily solicits Qualcomm and the Jacobses, which has a downside.

“I feel very much that the university has become complacent in the sense that it is too easy to go and ask either the Jacobs family or Qualcomm (for help),” Christensen said.

“I would like to see more competitive recruiting of support for the university.”

In particular, Christensen says the university needs to pursue money from tech companies like Intel and Nvidia to broaden the school’s outlook and support.

Nikhil Varaiya says the situation might not be as worrisome as it appears.

“People are always anxious when a deal like this happens,” said Varaiya, a finance professor at San Diego State University.

“There would be changes. But Qualcomm is not leaving town. They will continue to be a big presence. Broadcom is trying to buy Qualcomm because of its power in R&D.

“But San Diego does needs to become more diversified, which is something that can be done. Seattle used to be dominated by Boeing. Now it also has companies like Amazon and Microsoft — companies that have worked with the University of Washington.

“The first time I visited San Diego, it was mostly a Navy town with lovely weather. Now it has Qualcomm, Illumina, and Thermo Fisher (in Carlsbad.)